China’s Digital Economy Now World’s Second Largest, Accounts for Third of GDP

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A new report indicates that roaring growth in China’s digital economy has made it the second largest in the world, accounting for nearly a third of the country’s GDP.

The “Digital China Establishment and Development Report (2017)” (数字中国建设发展报告(2017年)) released by China’s State Internet Information Office indicates that the size of China’s digital economy reached 27.2 trillion yuan last year, for year-on-year growth of 20.3%.

China’s digital economy is now the second largest in the world, comprising 32.9% of domestic GDP.

The Chinese government is betting on accelerated digitisation to drive increases in industrial efficiency as well as wealth gains for average citizens.

According to research for every 10% increase in China’s “digitisation level,” per capita GDP rises by between 0.5% and 0.62%.

A survey from China’s Ministry for Industry and Information Technology also concluded that digitisation and the introduction of smart technologies could raise the productive efficiency of enterprises by over 30% on average, and cut operating costs by approximately 20%.

“Digitisation is the foundation for smart manufacturing and the industrial internet,” said He Xiaolong (何小龙), vice-chair of the State Industrial Information Security Development Research Center to The People’s Daily.

“Manufacturing sector enterprises must deepen their shift towards digitisation, and by means of the accumulation of data and digital model analysis achieve optimisation of production processes.”

According to He digitisation can best be achieved by enterprises via cloud computing platforms, which will enable enterprises with different focal points to fulfil their own respective priorities.

“Some enterprises will emphasise research and development, and by means of cloud-based data better guide research and development,” said He. “Some enterprises will focus on sales, and big data can help them to conduct market analysis.

“Future internet manufacturing will depend upon industrial internet platforms, that enable enterprises to utilise their own advantages with the greatest effect.”

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